Ryan v Cornwall
[2011] QCAT 322
•11 July 2011
| CITATION: | Ryan v Cornwall [2011] QCAT 322 |
| PARTIES: | DAVID & RENE (MAREA) RYAN |
| v | |
| KENNETH CORNWALL |
| APPLICATION NUMBER: | BDL010-10 |
| MATTER TYPE: | Building Matters |
| HEARING DATE: | On the papers |
| HEARD AT: | Brisbane |
| DECISION OF: | Mr Barry Cotterell, Member |
| DELIVERED ON: | 11 July 2011 |
| DELIVERED AT: | Brisbane |
ORDERS MADE: | 1. The Applicants will pay the Respondent's costs of and incidental to the proceedings from 13 May 2010 to 29 November 2010 on a standard basis on the District Court Scale as agreed or, failing agreement, as assessed. 2. The Respondent's costs will be assessed as follows: (a) The Respondent will deliver to the Applicants an itemised claim for costs referring to the relevant items contained in the scale; and 3. The Applicants will pay the Respondent's costs (as agreed or assessed) within fourteen (14) days of such agreement or assessment. |
| CATCHWORDS : | COSTS – application to QCAT for costs of proceedings –first application struck out and amended application dismissed - factors in awarding costs – interests of justice - ss 100 & 102 QCAT Act - Tamawood Limited v Paans[2005] QCA 111 applied |
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers in accordance with section 32 of the Queensland Civil and Administrative Tribunal Act 2000 (QCAT Act).
REASONS FOR DECISION
Introduction
This is an Application for costs by the Respondent arising firstly from an application based on alleged breach of statutory warranty which was struck out and secondly from an application for damages for negligent building work by the Respondent in reliance on Bryan v Maloney (1995) 182 CLR 609 which was dismissed.
The Tribunal had granted leave to the parties to be legally represented at directions hearings on 11 March and 28 April 2010.
On 13 May 2010, the Tribunal directed that:
1. Those parts of application number BDL10-10 with respect to an alleged breach of statutory warranty pursuant to the Domestic Building Contracts Act 2000, by the Respondent, be struck out, as being out of time.
2. The Applicants have leave to file and serve an amended Application.
3. The parties attend a Directions Hearing…”
The Applicants filed an amended Application this time seeking damages for negligent building work by the Respondent in reliance on Bryan v Maloney (1995) 182 CLR 609.
The Respondent filed a Defence and the application was listed for a hearing in Maroochydore on 29 November 2010.
Neither party was legally represented at the hearing of the matter on 29 November 2010.
Factual Background
At the hearing, Mrs Ryan said that she contacted Brent Dennis, a tiler and waterproofer, who attended before September 2008 and suggested they contact the builder. Mr Dennis, however, gave evidence that he attended in February 2009 and quoted for what he thought was a small job ($6,715.50 plus tiles). He subsequently invoiced them for $8,285.20 including $55 for a “written report on tiling faults”. There was no explanation offered for these differences.
The Applicants case depended on the expertise and evidence of Mr Dennis as no one else inspected the alleged defective building work.
The Tribunal noted that Cooloola Tile Company issued an order No 2019 for the replacement tiles dated 9 January 2009.
On this basis, the Tribunal found that the Applicants ordered replacement tiles for the house before Mr Dennis commenced his work and determined that all of the tiles needed to be replaced.
The Tribunal also found that the building work, being the tiling, was not defectively carried out. It made this finding on the basis that if the tiling was defective it would have been obvious well within the normal 6 years and 6 months which the law uses as a warranty period.
The Tribunal stated:
“In carrying out this work for the Applicants, Mr Dennis failed to mitigate their damages. He could have carried out the work in other less expensive ways. For example, ways which did not involve replacing all floor and wall tiles in the entire house.
On the basis of the evidence of Mr Dennis the Tribunal finds that it is not satisfied that the work he carried out was necessary or reasonable.”
The Costs application
The Tribunal’s jurisdiction in respect of costs is dealt with in Division 6, sections 100 to 109 inclusive of the QCAT Act. Sections 100 and 102 say as follows:
100 Each party usually bears own costs
Other than as provided under this Act or an enabling Act, each party to a proceeding must bear the party’s own costs for the proceeding.
102 Costs against party in interests of justice
(1) The tribunal may make an order requiring a party to a proceeding to pay all or a stated part of the costs of another party to the proceeding if the tribunal considers the interests of justice require it to make the order.
(2) However, the only costs the tribunal may award under subsection (1) against a party to a proceeding for a minor civil dispute are the costs stated in the rules as costs that may be awarded for minor civil disputes under this section.
(3) In deciding whether to award costs under subsection (1) or (2) the tribunal may have regard to the following—(a) whether a party to a proceeding is acting in a way that unnecessarily disadvantages another party to the proceeding, including as mentioned in section 48(1)(a) to (g);
(b) the nature and complexity of the dispute the subject of the proceeding;
(c) the relative strengths of the claims made by each of the parties to the proceeding;
(d) for a proceeding for the review of a reviewable decision—(i) whether the applicant was afforded natural justice by the decision-maker for the decision; and
(ii) whether the applicant genuinely attempted to enable and help the decision-maker to make the decision on the merits;(e) the financial circumstances of the parties to the proceeding;
(f) anything else the tribunal considers relevant.The starting point in relation to costs under the QCAT Act is section 100. However, section 102 then provides the Tribunal with a discretion to make an order requiring a party to a proceeding to pay all or a stated part of the costs of another party to the proceeding if the tribunal considers the interests of justice require it to make the order. Sub-sections (3)(a), (b), (c), (e) and (f) then become relevant in terms of the interests of justice for determining why there should be a positive exercise of the discretion in that party's favour". Tamawood Ltd & Anor v Paans [2005] QCA 111 (15 April 2005).
Keane JA, in Tamawood, went on to hold:
“[30] First, the Tribunal found that each party was justified in engaging the services of legal representatives to assist them in the conduct and defence of what the Tribunal recognized to be complex proceedings. That finding alone could be, in my view, a sufficient basis to conclude that the interests of justice warranted the exercise of the discretion to award costs in favour of the successful party, at least in the absence of any countervailing consideration. The Tribunal erred in failing to appreciate the implication of this finding for an understanding of where the interests of justice lay in relation to the costs of the proceedings.
[32] If orders for costs were not to be made in favour of successful parties in complex cases, then just claims might not be prosecuted by persons who are unable to manage complex litigation by themselves. Such a state of affairs would truly be contrary to the interests of justice; and an intention to sanction such a state of affairs cannot be attributed to the legislature which established the Tribunal.”In deciding whether to exercise its discretion to award costs in the interests of justice in this matter, the Tribunal should have regard to the matters in section 102 of the Act.
(a) whether a party to a proceeding is acting in a way that unnecessarily disadvantages another party to the proceeding, including as mentioned in section 48(1)(a) to (g);
(b) the nature and complexity of the dispute the subject of the proceeding;
(c) the relative strengths of the claims made by each of the parties to the proceeding;
(d) …
(e) the financial circumstances of the parties to the proceeding;
(f) anything else the tribunal considers relevant.
Success in the Proceeding
The Application based on alleged breach of statutory warranty was struck out and the amended application alleging negligent work based on Bryan v Maloney (1995) 182 CLR 609 was dismissed.
The First application was brought well out of time and accordingly was struck out.
The Applicants case in the amended application was that they proceeded to replace all of the floor and wall tiles in the house after Mr Dennis had advised them that this was necessary. However, Mr Dennis did not attend until February 2010 after the Applicants had purchased all of the tiles on 9 January 2010.
On this basis, their applications were most unlikely to succeed which proved to be the case.
Whilst it is clear that success in a proceeding is not of itself a ground for the award of costs, in this case the Applicants’ persistence with their applications, is a factor that weighs in favour the Respondent.
Conduct of the Parties
The Applicants failed to objectively consider the evidence as to the need to replace all of the floor and wall tiles. Their obvious decision to do so and then, despite the evidence, to seek to claim the cost from the Respondent resulted in them commencing and continuing unwarranted litigation.
In the Tribunal's view the conduct of the Applicants weighs in favour of a costs order in favour of the Respondent.
Nature and Complexity
The complexity of the issues involved justified engaging legal representation which was approved by the Tribunal on 11 March and 28 April 2010.
The complexity arose from the Applicants desperation to justify their claim which was brought well out of time and, therefore, had to be justified by more complex legal grounds.
In the Tribunal's view the conduct of the Applicants weighs in favour of a costs order in favour of the Respondent.
Strength of the Claims
The Applicants decision to replace all of the floor and wall tiles and then, despite the evidence, to seek to claim the cost from the Respondent resulted in them commencing and continuing unwarranted litigation.
Costs from 13 May 2010 to 29 November 2010
After the hearing of 13 May 2010, the member declined to make an order for costs so it would not be appropriate for costs to be ordered prior to that date.
While the Tribunal only approved legal representation for the two directions hearings, the complexity of the claims made and persisted with by the Applicants justified the Respondent obtaining legal advice to defend this matter. The Respondent, naturally, will not claim for representation at the hearing on 29 November 2010 but is entitled to claim for legal advice relating to the matter obtained up to and including that date.
Having regard to the above considerations under section 102, the Tribunal determines that costs in the proceedings on a standard basis should be awarded to the Respondent from 13 May 2010 to 29 November 2010.
The District Court scale should be used for the assessment of costs.
Orders
The Applicants will pay the Respondent's costs of and incidental to the proceedings from 13 May 2010 to 29 November 2010 on a standard basis on the District Court Scale as agreed or, failing agreement, as assessed.
The Respondent's costs will be assessed as follows:
(a) The Respondent will deliver to the Applicants an itemised claim for costs referring to the relevant items contained in the scale; and
(b) If within 14 days of that delivery, the parties have not agreed to an amount for costs, the costs shall be assessed by a legal costs assessor.The Applicants will pay the Respondent's costs (as agreed or assessed) within fourteen (14) days of such agreement or assessment.
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